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Thursday, February 5, 2015

Leaving a good tip - frugality meets generosity

"I'm all about the family budget, and being frugal, and not wasting money when you can put it to better use somewhere else. I realize that a tip is not a specifically agreed upon amount; it's a zero sum transaction where every dollar you choose to leave is a dollar the waiter gets and you don't have anymore. But here's the thing: Don't be a cheap bastard."

You've had a good week, the kids did well in school, and you want to take the family out to dinner. You know the budget's tight, but you decide it's worth it, so you load everybody in the car and head out to Applebees.

tipping after a restaurant meal
image credit: nowiknow.com


Before you even get to the restaurant, you know you're conservatively going to spend $10 per person on food, $1.50 per person on drinks, and add in about 8-10% for tax. That puts you at about $50 for your family of four. And then comes the big question:

How much should you tip?

Before we answer that question, let's talk for a minute about the whole restaurant process in America. We have an unspoken and unwritten agreement with the restaurants regarding our meal:

  • Restaurant will give us a place to sit down and eat our meal.
  • Restaurant will provide us with high quality food prepared in such a way as to comply by all FDA and EPA standards.
  • Restaurant will employ staff to keep the premises clean, prepare our food, and manage the process of who gets to eat when and where.
  • Restaurant will employ Waiters, whose job is to help facilitate our enjoyable dining experience.
  • Restaurant will pay a portion of Waiters' wages.
  • We will pay Restaurant a pre-specified and pre-agreed to amount, after we're done eating.
  • We will pay a portion of Waiters' wages, in the form of a tip and in an unspecified and not pre-agreed to amount, after we're done eating.
  • Restaurant will clean up our table and wash our dishes after we leave.


The part about the tip being unspecified and not pre-agreed to is important. You can walk out of the restaurant without leaving any tip at all, and no one will call the police. Conversely, you can leave $1,000 for the waiter, and he won't have any obligation to chase you out to the parking lot and tell you that you left too much.

The part about the waiters' job being to help facilitate your enjoyable dining experience is also important. We've all had waiters who are extremely friendly, attentive, and helpful. We've also had waiters who are not-so-friendly, forgetful, or who downright ignore you. And of course there's everything in-between. I don't believe they all deserve the same amount of a tip, and I'm happy to leave more for a good waiter and less for a bad waiter.

But that still doesn't tell me how much I should leave...

15% is a generally accepted rule of thumb guideline - if you leave 15% your waiter won't be overly excited, but he neither will he call you names behind your back after you leave. I know people who routinely tip 20-25% (which seems very generous), and I've seen people leave 10% even after excellent service (which felt embarrassingly low).

I don't think there's anything wrong with starting out at 15%, and then sliding up or down a little bit from there depending on the waiter's performance.

Regarding the waiter:

  • Was the waiter enjoyable to talk with?
  • Was he knowledgeable about the menu?
  • Did he remember to bring you that extra side of sauce you asked for?
  • How did he respond if something was wrong with your order?
  • I would happily slide the tip upwards to 20% if the waiter was really good, and I wouldn't mind sliding the tip downward towards 10% if the waiter was rude or unhelpful. (If you leave a smaller tip, you can leave a note saying you were disappointed with the service too. This lets the waiter know you were willing to pay more, but their service wasn't acceptable. Without a note, they will simply assume they were fine and you're too cheap to leave a good tip.)

Regarding tipping in general:

Don't purposely under tip. A five percent marginal difference on that $50 meal is $2.50. This means the difference between 10% and 15%, or between 15% and 20%, is $2.50.

I'm all about the family budget, and being frugal, and not wasting money when you can put it to better use somewhere else. I realize that a tip is not a specifically agreed upon amount; it's a zero sum transaction where every dollar you choose to leave is a dollar the waiter gets and you don't have anymore. But here's the thing: Don't be a cheap bastard.

$2.50 should not be a lot of money to you. Yes, I understand you're watching every dollar, and that a dollar here and a dollar there adds up to whether or not you're under budget this month.

However, you're the one who chose to go out to a restaurant in the first place. If the difference between $57.50 and $60 is a deal-breaker, maybe you shouldn't have gone out to eat, or you could have gone to a less expensive restaurant.

Waiters rely on tips as the primary source of their income, so when you stiff the tip, you're really asking forcing your waiter to work for a reduced wage. (Do you ever offer your boss a chance to pay you less?) And that $2.50 - while it isn't a lot for each individual family, it can add up to $25 or more for the waiter over the course of the night, if everyone used the same sliding scale. This would allow the good waiters to consistently earn a better living.

In the end

Budget for the tip as part of your meal, and be generous with those who treat your family well. Using the tip as a place to save money is just wrong - it's the difference between frugal and being cheap. And if karma has any say, it'll probably come back to bite you in the butt.

Tip fairly, but tip well.

-Chris Butterworth

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